The World Bank says India's march to be the fastest-growing economy is becoming buoyed by strong domestic demand, increased investment, and a vibrant services sector, also led by growth of 6.7 percent over the next three fiscal years.
In its 'Global Economic Prospects' report, the World Bank kept the growth forecast for India at 6.6% for FY25 and said the nation will remain the fastest among world majors but the pace of expansion might ease a bit. "After the high growth rate of FY 2023/24, the trend growth for the three years from FY 2024/25 is projected to be 6.7 percent on an average," said a report released by the bank.
The bank foresees India's economy growing by 6.7% and 6.8% in FY26 and FY27. The report said, "Private consumption growth is expected to gain from a rebound in agricultural production and decreasing inflation. Government consumption is projected to increase slowly, aligning with the government's goal of reducing current expenditure relative to GDP."
Earlier this month, the International Monetary Fund (IMF) had revised India's growth forecast for 2024-25 upwards at 6.8 percent from 6.5 percent, citing robust domestic demand and a growing working-age population. In another turn of events, the Reserve Bank of India (RBI) has revised its GDP growth projection for the current fiscal year 2024-25 from 7% to 7.2%, banking on a sustained high level of momentum. According to him, GDP growth in Q1 of 2024-25 would be 7.3%, further followed by 7.2% in Q2, 7.3% in Q3, and 7.2% in the fourth and final quarter.
The Indian economy recorded a strong growth rate of 7.8 percent in the January-March quarter, FY 2023-24. For the whole financial year 2023-24, this growth rate reached an impressive 8.2 percent, up from 7 percent in FY 2022-23. Accordingly, the Ministry of Statistics underlined the development of this high growth based on the strong performance of the manufacturing and mining sectors.
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